International disputes: Costa Rica and Nicaragua regularly file border dispute cases over the delimitations of the San Juan River and the northern tip of Calero Island to the International Court of Justice (ICJ); in 2009, the ICJ ruled that Costa Rican vessels carrying out police activities could not use the river, but official Costa Rican vessels providing essential services to riverside inhabitants and Costa Rican tourists could travel freely on the river; in 2011, the ICJ provisionally ruled that both countries must remove personnel from the disputed area; in 2013, the ICJ rejected Nicaragua's 2012 suit to halt Costa Rica's construction of a highway paralleling the river on the grounds of irreparable environmental damage; in 2013, the ICJ, regarding the disputed territory, ordered that Nicaragua should refrain from dredging or canal construction and refill and repair damage caused by trenches connecting the river to the Caribbean and upheld its 2010 ruling that Nicaragua must remove all personnel; in early 2014, Costa Rica brought Nicaragua to the ICJ over offshore oil concessions in the disputed region
.

Geography

This Central American country lies between
Nicaragua to the north and Panama to the south. Its area slightly exceeds
that of Vermont and New Hampshire combined. It has a narrow Pacific
coastal region. Cocos Island (10 sq mi; 26 sq km), about 300 mi (483 km)
off the Pacific Coast, is under Costa Rican sovereignty.

Government

Democratic republic.

History

Costa Rica was inhabited by an estimated 400,000
Indians when Columbus explored it in 1502. The Spanish conquest began in
1524. The region grew slowly and was administered as a Spanish province.
Costa Rica achieved independence in 1821 but was absorbed for two years by
Agustín de Iturbide in his Mexican empire. It became a republic in
1848. Except for the military dictatorship of Tomás Guardia from
1870 to 1882, Costa Rica has enjoyed one of the most democratic
governments in Latin America.

In the 1970s, rising oil prices, falling
international commodity prices, and inflation hurt the economy. Efforts
have since been made to reduce reliance on coffee, banana, and beef
exports. Tourism is now a major business. Óscar Arias
Sánchez worked to simultaneously heal his country's economic woes and foster peace in Central America.

José Maria Figueres Olsen of the National
Liberation Party became president in 1994. He opposed economic suggestions
made by the International Monetary Fund, instead favoring greater
government intervention in the economy. The World Bank subsequently
withheld $100 million of financing. In 1998, Miguel Angel Rodríguez
of the Social Christian Unity Party became president, pledging economic
reforms, such as privatization. In 2000, Costa Rica and Nicaragua resolved
a long-standing dispute over navigation of the San Juan River, which forms
their shared border. A psychiatrist, Abel Pacheco, also of the Social Christian
Unity Party, won the presidency in elections held in April 2002. In May
2003, several national strikes took place, by energy and
telecommunications workers over privatization and by teachers over their
salaries.

Nobel Peace Prize Winner Again Gains Presidency

Costa Rica has a reputation as one of the most
stable, prosperous, and least corrupt Latin American countries. But in
fall 2004, three former Costa Rican presidents (José Maria Figueres
Olsen, Miguel Angel Rodríguez, and Rafael Angel Calderon) were
investigated on corruption charges. In 2006, Óscar Arias Sánchez was elected president. Arias, who had served as president once before
(1986–1990), won the Nobel Peace Prize in 1987 for fostering peace
talks that eventually ended the civil wars in El Salvador and
Nicaragua.

The Costa Rican government
voted in November 2008 to implement the Central American Free Trade Agreement that voters had approved in October 2007.

First Woman Elected President

In February 2010, Laura Chinchilla became the country's first woman to be elected president, taking 47% of the vote. She's a protégé of outgoing centrist president Oscar Arias. Due to Article 132 of Costa Rica's Constitution, Chinchilla was ineligible to run for a second consecutive term.

Luis Guillermo Solís was elected president in May 2014. A member of the center-left Citizens' Action Party, Solís easily won the presidency after first round runner-up, San José Mayor Johnny Araya Monge stopped actively campaigning.